PSPF’S EQUITIES IN SA DELIVER YIELD OF 1.4 %

MBABANE – As of March 31, 2023, the Public Service Pension Fund (PSPF) had invested 37 per cent (E11.6 billion) of its equities in South Africa (SA).

According to the PSPF annual report for the financial year ended March 2023, the funds invested in SA were with Allan Gray, Sanlam Investment Management, Aluwani Capital Partners, STANLIB Asset Management Limited, Old Mutual Investment Group, African Alliance and Balondolozi Investment Group. According to the report, SA equities delivered an average performance of 1.4 per cent in the period under review against a benchmark of 0.2 per cent. There was a sharp decline in equity performance compared to the average performance of 20.5 per cent received in March 2022, which was a result of continuing geopolitical tensions, Eskom load-shedding issues which have affected production and manufacturing, and the strengthening of the Dollar against the South African Rand.

Performance

PSPF invested 19 per cent of its total portfolio in the offshore market, with STANLIB Global Multi Manager and Alexander Forbes Jersey. Performance of the two Amanagers improved in the period under review; however, the overall performance of the offshore investments was slightly below the benchmark. The appreciation of the Dollar to the Rand has also improved returns. The average return received was 11.4 per cent gross of fees against a benchmark of 12.9 per cent in the period under review. This resulted in an underperformance of 1.5 per cent.  On the domestic portfolio, the market value was E13.7 billion as of March 31, 2023. This portfolio is invested under two mandates. There is the portfolio under segregated mandates and the other is directly managed by the fund. This approach has enabled the fund to properly diversify its portfolio into all sectors of the economy. Meanwhile, pension contributions received amounted to E1.261 billion in March 2023, against E1.276 billion in March 2022.

Obligations

The fund remained liquid, as it met all its financial obligations as they fell due including timely release of funds for investment projects. The fund invested in government bonds, private sector corporate bonds and loans for government agencies, which amounted to E4.5 billion. During the period under review, the fund paid out a total of E1.4 billion in benefits to members.

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